According to figures obtained by the SNP Falkirk Council’s four Private Finance Initiative (PFI) High Schools built in the late 1990’s will cost a total estimated to be around £420m once the current 25 year lease has expired.
Councillors were informed in June 1998 that the schools package using the controversial PFI method of funding would cost around £214m, for the four schools that were built for around £65m.
Quote from Cllr Cecil Meiklejohn, SNP Group Leader, Falkirk Council,
“What this proves is that the SNP were correct to oppose the use of the Tory methodology of funding capital projects with the Private Finance Initiative (PFI).”
“However, that does not explain the disparity in the figures supplied to elected Councillors in 1998 when the contract was signed with Class 98 and the up to date figures seventeen years into that contract.”
“It also gives more than a clue as to where the £48m black hole in council budgets emanates from as there is clearly not only a cost over run but, contrary to the 1998,a substantial impact on the General Fund and therefore the Council Tax.”
“This exposes the lie that it is the Council Tax Freeze that has caused the black hole and demonstrates clearly that it is Labour’s implementation of Tory policies that has created the current crisis in Falkirk Council’s task of preserving both services and jobs.”
Councillor David Alexander who was opposition SNP Leader at the time of the signing of the contract added,
“chickens are coming home to roost in this, as we predicted in 1998.”
“On the day the final business case was presented to opposition Councillors, behind closed doors, we were given 15 minutes to read a document that was an inch thick before being asked to approve it. At the end of the meeting all copies were collected up and so there was very little by way of scrutiny in what was until then the largest contract entered into by Falkirk Council.”
“Council taxpayers have paid a hefty price for this and, thanks to Labour mismanagement this is the gift to the private sector that keeps on giving. Still to be added to the overall cost of the schools is the exit strategy that will require Falkirk Council to renew the lease at the end of year 25 or pay an additional £5m to take ownership thus pushing up the overall cost to close on £420m for schools that cost £65m to construct.”
“It is no wonder that Falkirk Council under this Labour / Tory Coalition Administration have a financial black hole in their budgets that is disproportionably higher than the vast majority of Scottish Local Authorities.”